What the Brewdog Scandal Teaches Us About Leadership

James Watt and Martin Dickie were the plucky underdogs in a beer saturated market.  

Starting in 2007 as a tiny Scottish brewery they quickly grew the business into four breweries, a hotel and 100bars across the world.  And they did itall through crowdfunding style investment.

What’s more, they launched just as the recession hit. But in 2008 their hard work paid off when they won aTesco-sponsored beer competition and their business took off.

Still, they were little fish in a giant ocean so they did what the big breweries couldn’t do and got creative with PR.

Brewdog was a British success story... until it wasn't

They projected an image of themselves on the Houses of Parliament, naked save for a box of their beer, dropped dead stuffed cats on Wall Street and brewed their beer in as many unusual placesthey could think of.

These two unassuming Scottish men turned a home-brewing business into a major global brand packed with personality, ingenuity and diversifying at every turn.

Brewdog was a British success story and the press lauded them as the brand that could teach old dogs new tricks.

Until June 2021 when their trendy, cool, bubble burst.

A group of former employees wrote a scathing open letter exposing a toxic culture and posted it on social media for all to see. That carefully crafted maverick image dissolved with one shocking missive that no one saw coming, least of all Watt and Dickie.

Among the accusations were… 

• Brewdog was built on a cult of personality
• Focus on growth at all costs
• Ends allowed to justify the means
• Stunts and PR campaigns littered with lies, hypocrisy and deceit
• Weight given to misogynistic and sexist brewers, at odds with their ethos
• Being treated like a human being wasn’t a given
• Actions that contrasted with their ‘save the planet’ messaging
• Response to issues raised was ‘that’s just the way things are’
• Unmanageable and damaging work culture
• Fear soaked environment
• People treated as collateral damage of growth
• Disregard of health and safety guidelines

Ouch.

It seems that our fearless young heroes, who wanted to be ‘the best employer in the world’, had ridden the wave of business success but forgotten about the absolute foundation of any company:Its people.

When you read the open letter from Brewdog employees, did you feel confident that no such letter would ever be written about your own company culture? Or was there an uncomfortable feeling of recognition?

Effective leaders know all too well that they ignore the human part of business resources at their peril.

So where did Brewdog go wrong and what lessons can we learn from their public humiliation?

1. They took their eye off the ball

Given their speed-of-light growth from garage to global, it’s entirely possible, likely even, that Brewdog didn’t have their eye on the ball in the first place.

Great leaders are honest, realistic and fair and expect the same in return.

Watt and Dickie seemed to gather staff like an avalanche, promising the world to attract the best talent without the structure to actually deliver on their word. They expected everyone to have a home-business mentality which only works when you have a headcount of one.

Great leaders don’t tell people what they want to hear and they don’t make promises they can’t keep. They are honest, realistic and fair and expect the same in return.

Employee goodwill will help businesses smooth over a few bumps in the road but it won’t get the company up a steep hill.   The fact is a job for life is no longer a prize and businesses who think their staff should be grateful just to be there will leak talent at an alarming rate.

Brewdog’s pursuit of growth at all costs was a false economy. Yes it’s exciting to build a business and to chase opportunity but without a workforce that feels valued with the right resources in place, it’s all a house of cards.

People are a leader’s number one asset and they need to be prioritised in all decisions that will affect them.

Presenteeism and overworking shouldn’t be normal. That kind of culture sets the bar so impossibly high that most people fail even if they are great at their job and meet all targets.  

Before leaders make a decision to expand and diversify they need to be sure theexisting structure is sound with the right people in the right roles and a clear plan to expand the team to accommodate greater workloads.

Effective leaders bring their employees with them on their growth journey, theydon’t keep throwing things at them.

2. They didn’t listen

In his response to the open letter, Watt acknowledged that exit interviews ‘could be a good thing to do.’  And he’s right.

A business that is always striving to do better and to retain good staff, should have the humility to conduct proper exit interviews to see if there are any areas that are broken and need fixing.  

But Brewdog didn’t just have the odd disgruntled ex-employee, inevitable for any business, they had 60 of them willing to put their name against a damning letter, plus another 45 who were too scared to sign it.  

Had they arranged exit interviews Brewdog would have been alerted that all was not well in the business, but who’s to say they would have taken negative feedback as seriously as they should?

‘That’s just the way things are.’

Judging by the contents of the open letter, the way things are at Brewdog is inhumane, unsafe and unhappy.

As leaders, we’re not always at the coal-face anymore.  We rely on feedback moving up the chain but for that to work effectively we need to trust that information won’t be filtered on the way up and that we don’t filter it ourselves to reframe each negative into a positive.

Were the Brewdog bosses too busy thinking up new ideas to find out how the old ones were affecting their staff?

That might sound great in a management psychology course but it’s called avoidance in real life.

We’ve all met people who may as well have their fingers in their ears when someone tries to bring problems to the table and that may have been the case for the Brewdog bosses too busy thinking up new ideas to find out how the old ones were affecting their staff.

Who are you listening to?  It’s important that you can trust the veracity of information and not receive a version that puts the messenger in a better light. Does your team feel comfortable approaching you with difficult news? If the honest answer is ‘no’ then you are creating an environment of half-truths and a blame culture that will permeate every part of your business.

The truth, no matter what it is, has to be sacred, unless you’re comfortable with the next open letter being about you.  

Make feedback meaningful, two-way and regular.

Regular feedback is better than scheduled annual appraisals where managers and employees store up issues and grievances for a one-hour misery-fest.    Make honest communication the norm with a transparent system for getting feedback straight to the person who can do something about it. That’s probably you.

As the saying goes, if you don’t ask, you don’t get. Brewdog never asked.

3. Their public values didn’t match their private ones

Company culture is a key differentiator when it comes to attracting and retaining the best with interviews very much two-way affairs these days. But your public image has to match the company culture or, as Brewdog were, you will be found out.

Before Watt’s later, more contrite response, he sent a memo to current staff saying Brewdog’s ‘fast-paced and intense environment isn’t for everyone.’

This statement was incredibly telling about the real culture behind the trendy image.  

Did that environment work for anyone but the co-founders who, after all, got to fly around having fun rather than do the intense serious work behind the scenes?

Their idea of the ideal employee is not remotely realistic.  

That can easily happen to leaders of young companies who expect employees to give every waking moment to the business simply because they do.

That level of intensity is unsustainable, the fastest way to lose good people and completely at odds with being ‘the best employer in the world’.

If you were to describe your ideal employee right now, what would you say?  Incredibly flexible, always willing to go the extra mile, puts the hours in, never goes home?

Does that person really exist in your organisation? What culture does that foster and is it a culture you’d be happy to publicise?  Frankly, that isn’t an ideal employee, it's a machine.

As leaders we must value variety, not clones of ourselves.

Everyone has a personal life. They all have responsibilities and pressures outside of the office and if you recruit based on an impossible ideal you will create a culture that burns out anyone who can’t live and breathe your business 100% of the time.

As leaders, we must value variety not clones of ourselves because each cog in the machine needs to be happy, healthy and feel invested in the business as a whole. We must recognise the importance of equity as well as equality.

If we want to be excellent employers we must walk the talk and see the individual not a homogenous workforce.

Brewdog are saying all the right things but it will take a herculean effort to create a brand new work culture that matches their image because the trust has gone.  It’s a global business sitting on a foundation of fear and intimidation and now it’s crumbling.

The only way to make the changes it needs to thrive internally, not just externally, is a root and branch review of the way things are done.

The moral of their story, if we’re to learn from their mistakes, is to slow down, listen to our employees and understand that company culture starts at the top: The fastest way to a healthy culture is to made sure we as leaders embody it, communicate it and make it an intrinsic part of every decision we make.